US Inflation in April Jumps, Annual Inflation Rate at 2%

US inflation in April advanced the most in nearly a year as Americans paid more for a wide range of goods and services, the latest report from the government on consumer prices shows.

Costs continued to climb for food and shelter, and picked up again for gas and other energy categories after three straight months of some relief.

US consumer prices rose 0.3% in April, the Labor Department’s Bureau of Labor Statistics (BLS) said Thursday, May 15, in its monthly accounting of the Consumer Price Index. The CPI measures changes in prices that American consumers pay for a select group of goods and services. The level marked the biggest one-month jump since June and follows the March climb of 0.2%.

"Inflation may be normalizing a bit faster than we thought," the Wall Street Journal quoted Laura Rosner, U.S. economist at BNP Paribas. "It’s still too early to assume this will persist, but it certainly raises the risks of higher inflation at year end than we are currently forecasting."

Food costs maintained their burdening weight to Americans’ paychecks, rising 0.4% for the third consecutive month. The price of meat was most painful, soaring 2.9% for the largest increase since November 2003. Fresh fruits rose 0.7% while dairy and related products climbed 0.5% for a sixth straight monthly gain. Prices of cereals and bakery products were unchanged. On a year-over-year basis, overall food prices rose 1.9% with the cost of meats, poultry, fish, and eggs jumping 6.4%.

Energy prices advanced for the first time since January, up 0.3% in April and 3.3% from a year ago. Within the energy grouping for the month, gasoline rose 2.3% and natural gas climbed 0.3% even as oil costs went down 3% and electricity prices fell 2.6%. The largest gain over the last 12 months belongs to natural gas, up 11.8%, while gasoline increased 2.4% and the electricity advanced 2.1%.

Core consumer prices in April advanced 0.2%, matching the previous month. This core reading excludes food and energy categories that are almost always more volatile. Core advancing items included:

  • Shelter, up 0.2%
  • Rent, up 0.3%
  • Lodging away from home, up 0.4%
  • Medical care commodities, up 0.3%
  • Medical care services, also up 0.3%
  • Airfares, up 2.6% for the biggest increase since November 2009
  • New vehicles, up 0.3%
  • Used cars and trucks, up 0.5%
  • Tobacco, up 0.1%

Costs for clothing, household furnishings, and personal care were all unchanged in April.

US inflation increased 2% over the last 12 months, the quickest yearly inflation pace since last July. Annual inflation was at 1% as recently as October, which marked smallest 12-month increase since October 2009. Past inflation rates reported by the BLS for 2014 include annual increases of 1.5% in March, 1.1% in February and 1.6% in January.

Core US inflation picked up 1.8% in the year-over-year period ended April after rising 1.7% in March. Earlier core rates reported in 2014 include matching 1.6% gains in February and in January. The core annual rate has been stuck between 1.6% and 1.8% for 13 months in a row. It is the benchmark inflation figure monitored by the Federal Open Market Committee (FOMC) as it helps in deciding where to set the key interest rate. While the 1.8% increase is the biggest gain since last August, it remains under the Fed’s rate of inflation target of 2%.

Found below are percentage changes of prices for consumer goods and services that are surveyed and analyzed by the Bureau of Labor Statistic of the US Department of Labor. The data periods are monthly from October to April and over the past 12 months.

October 2012 – April 2014 Consumer Prices – Gains & Losses in Percent

  Oct 2013 Nov 2013 Dec 2013 Jan 2014 Feb 2014 Mar 2014 Apr 2014 12 Month
All items .0 0.1 0.2 0.1 0.1 0.2 0.3 2.0
  Food 0.1 0.1 .0 0.1 0.4 0.4 0.4 1.9
    Food at home .0 .0 .0 0.1 0.5 0.5 0.4 1.7
    Food away from home 0.1 0.3 0.1 0.1 0.3 0.3 0.3 2.2
  Energy -0.9 -0.4 1.6 0.6 -0.5 -0.1 0.3 3.3
    Energy commodities -1.5 -0.8 2.6 -0.5 -1.3 -2.0 1.9 2.7
      Gasoline (all types) -1.6 -0.8 2.6 -1.0 -1.7 -1.7 2.3 2.4
      Fuel oil -0.6 0.4 2.4 3.7 4.1 -2.9 -3.0 3.7
    Energy services 0.1 .0 0.1 2.2 0.7 2.6 -1.9 4.3
      Electricity 0.2 0.5 0.4 1.8 -0.2 1.1 -2.6 2.1
      Utility (piped) gas service -0.5 -1.5 -1.0 3.6 3.6 7.5 0.3 11.8
  All items less food, energy 0.1 0.2 0.1 0.1 0.1 0.2 0.2 1.8
    Commodities less food, energy -0.1 .0 .0 -0.1 -0.1 .0 0.1 -0.3
      New vehicles -0.1 -0.1 .0 -0.3 0.1 .0 0.3 0.4
      Used cars and trucks 0.4 0.3 .0 -0.5 -0.1 0.4 0.5 0.2
      Apparel -0.4 -0.1 0.4 -0.3 -0.3 0.3 .0 0.6
      Medical care 0.3 0.1 -0.6 0.5 0.6 -0.3 0.3 1.6
    Services less energy 0.2 0.3 0.1 0.2 0.2 0.3 0.3 2.6
      Shelter 0.1 0.3 0.2 0.3 0.2 0.3 0.2 2.8
      Transportation 0.4 0.3 -0.4 0.1 0.3 0.2 0.7 2.3
      Medical care .0 .0 0.2 0.2 0.2 0.3 0.3 2.7

 

US Inflation data from the BLS is released monthly and normally available about two weeks into a month, published after analyzing the data collected by the end of the reference month. Data for May inflation, in the form of the Consumer Price Index (CPI) and BLS summary report, is scheduled for release on June 17, 2014.

CPI data is used to calculate monthly and annual inflation rates and it is used by this site’s inflation-adjusting calculator. The US Inflation Calculator displays accumulated inflation and the change in buying power of the US dollar between two dates.

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